Exploring mechanisms to recover the proceeds of kleptocracy
Project completed
PROJECT TEAM
Maria Nizzero
Contact: marian@rusi.org
Maria Nizzero is a Research Fellow at the Centre for Financial Crime and Security Studies at RUSI. Her research examines the UK economic crime landscape, asset recovery, with a focus on sanctioned frozen assets and proceeds of kleptocracy, and the foreign policy dimension of illicit finance, including active financial measures. Maria is currently completing her Ph.D. in International Public Law and International Relations at the Universitat Pompeu Fabra in Barcelona, where she was also Associate Professor for four years, teaching the class of EU Politics and Institutions.
PROJECT SUMMARY
This project seeks to contribute to the ‘freeze to seize’ debate: how to move from temporary sanctions-based asset freezes of Russian-linked assets towards more permanent asset deprivation via criminal justice confiscation mechanisms. It does so by examining a range of established asset confiscation concepts – and their operationalisation in specific jurisdictions - which have their basis not in sanctions designations, but in evidentially-driven and judicially-overseen criminal justice processes. The aim of this research is to explore alternative asset recovery mechanisms that could help respond to the immediate policy goal surrounding Russian-linked sanctioned assets and also contribute to strengthening the broader asset recovery framework in the UK for the longer term.
The project uses the example of kleptocratic assets to set out the current limitations of UK civil recovery mechanisms. Given these challenges, the research looks at examples of three alternative mechanisms – lowering the standard of proof, reversing the burden of proof, and ‘societal danger’ models - across four jurisdictions – Australia, Switzerland, Ireland and Italy – weighing their potential and legal applicability in UK legislation.
The project concludes with a set of considerations for UK policymakers, which apply equally to the global debate, when thinking about reforming the country’s asset recovery mechanisms. While it does not intend to categorically push for one model to be adopted over others, it suggests that amendments to the current asset recovery mechanisms to incorporate a social damage or national security basis for asset recovery may be a starting point for discussion. Incorporating such concepts into the UK’s asset recovery framework may ensure they have better reach. Alongside this, some adjustments to existing legislation to include certain elements, such as a full reverse burden of proof and, most importantly, appropriate resourcing of law enforcement, will place law enforcement on the front foot when recovering the proceeds of crime and corruption in the UK.
PUBLICATIONS
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How to Seize a Billion: Exploring Mechanisms to Recover the Proceeds of Kleptocracy (SOC ACE Research Paper RP16)
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How to Seize a Billion: Exploring Mechanisms to Recover the Proceeds of Kleptocracy (SOC ACE Briefing Note BN23)
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Sanctioned assets: from freeze, to seize, to Kyiv? New Law Journal, Issue 8018, March 2023 (subscription needed)
ENGAGEMENT
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Maria Nizzero, ‘Sanctioned oligarchs should have to list their UK assets’, The Times, 23 February 2023
Maria Nizzero, ‘Oligarchs’ cash could help rebuild Ukraine – but don’t let them buy their way out of sanctions’, Guardian, 22 June 2023
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Maria Nizzero featured in: Kalyeena Makortoff & Rob Davies, ‘UK’s economic crime plan ‘smoke and mirrors’ without new funding’, Guardian, 30 March 2023
Maria Nizzero interviewed in: Matt Oliver, ‘Introduce anti-mafia laws to seize £1bn of dirty money, think tank suggests’, Telegraph, 19 December 2022
Maria Nizzero interviewed in: Liam James, ‘Russian oligarchs’ money could be used to rebuild Ukraine, says EU chief’, Independent, 30 November 2022
Maria Nizzero featured in: Stephen Roth, ‘Government reforms needed to claim £1bn in extorted assets’, City AM, 16 December 2022
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Maria Nizzero, ‘The complexities of seizing Russian assets’, RUSI, 10 June 2022 (RUSI members only)
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Maria Nizzero, ‘From freeze to seize: how the UK can break the deadlock on asset recovery’, RUSI Commentary, 10 October 2022
Maria Nizzero, ‘From freeze to seize: dealing with oligarchs’ assets in the UK’, RUSI Commentary, 13 April 2022
Tom Keatinge & Maria Nizzero, ‘From freeze to seize: creativity and nuance is needed’, RUSI Commentary, 7 June 2022
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House of Commons, Foreign Affairs Committee, Oral evidence: Responding to illicit and emerging finance, HC 168: Transcript | Video | Written evidence
IMPACTS
Early findings from research by Maria Nizzero (RUSI) on alternative mechanisms for seizing assets frozen through sanctions has been shared with the Minister for Security and with MPs on the Foreign Affairs Committee, the Committee on Standards and the Public Accounts Committee. A Bill on ‘Seizure of Russian State Assets and Support for Ukraine’ was introduced to the House of Commons on 7 February, with cross-Party support, and it excludes oligarchs’ assets following engagement with Nizzero regarding the human rights concerns her research highlights. In addition, she participated in the drafting of an amendment that was tabled in the Economic Crime (Corporate and Transparency) Bill drawing in part on her SOC ACE research. Her research was described by Lord Alton as ‘important’ in a speech to the House of Lords regarding his proposed amendment to the Economic Crime Bill to help strengthen the sanctions regime in line with the UK’s commitments to the rule of law and human rights.
The research has received media and political interest: Maria wrote this article in the Times and this article in the Guardian, and and her work has also been referenced in the Independent, the Telegraph and the Guardian, among other outlets. In addition, her research was featured in: Claire Mills, Philip Brien & Patrick Butchard, ‘Post-conflict reconstruction assistance to Ukraine’, House of Commons Research Library No 9728, 16 February 2023, as well as: Claire Mills, ‘Sanctions against Russia’, House of Commons Research Briefing No 9481, 23 May 2023. More engagement can be found above, as well as Maria’s contact information.